Michigan lawmakers pass $25 million no-fault fund in response to reform critics | News

LANSING – Michigan lawmakers agreed to allocate $ 25 million to fund gaps in the state’s flawless insurance reforms in 2019 when a provision went into effect lowering tariffs paid to caregivers.

Governor Gretchen Whitmer is expected to sign the bill, her office previously said that the federal COVID stimulus aid will be used to fund the program.

It’s about the 45 percent price cut that came into force on Thursday for healthcare providers who care for people injured in car accidents.

The state Department of Insurance and Financial Services has 21 days to complete a vendor application process to apply for funds. The ministry will review the applications and the money will be spent first if a “systemic deficit” can be demonstrated. “

Supporters, including US House of Representatives spokesman Jason Wentworth (R-Farwell) and some insurance groups, say it will give lawmakers time to gather data on potential policy issues that could then be addressed at a later date.

Critics of the measure say it is not too late that flawless reform now is likely to put some inpatient rehab facilities out of business and not help the severely injured car crash survivors or those who care for them.

“Vendors can’t wait six months to try to pay 45 percent of their funding stream,” said Tom Judd, president of the Michigan Brain Injury Provider Council.

“We don’t have a long-term solution now, and frankly we don’t have a short-term solution either,” said Judd. “These funds will only be available to providers in the future, at least six months later.”

In 2019, the state reformed the Auto Insurance Act to save drivers premiums by eliminating the need for unlimited personal protection.

Drivers can now choose from $ 250,000, $ 500,000, unlimited lifetime PIP coverage, or opt out completely if they can show they have other health insurance that covers auto injuries.

Under the new law, auto insurance companies are required to cut PIP premiums by between 10 and 100 percent, depending on the amount of coverage they have purchased for the next eight years, according to their Insurance Alliance of Michigan website.

The savings vary from company to company and from driver to driver, and if medical costs exceed coverage limits, drivers can check with their employer’s health insurance company, Medicaid, Medicare, or seek compensation from the guilty driver’s insurance policy, IAM says.

The law also prohibits insurance companies from using “non-driving factors” such as zip code, creditworthiness, gender, marital status, occupation, education, or home ownership to determine tariffs.

Those cost-cutting measures aren’t the problem Judd said – it’s the arbitrary lowering of nurse fees that insurance companies are likely to apply to new claims, as well as those charged years before the reforms were passed.

“This is the legislature that admits there is a problem but does not offer real solutions for families like mine,” said Kris Ruckle-Mahon, whose daughter Brittney Ruckle was injured in a car accident in 2007 and needs 24/7 care .

“It’s really sad that lawmakers haven’t gone out of their way to represent us,” said Traverse City’s Ruckle-Mahon. “I have a feeling Brittney was screwed and her care was bought up by the insurance companies.”

The fund has no provision to pay for the care of family members of the injured or to compensate families like the Ruckle-Mahons who hire caregivers on their own when agencies cannot provide staff due to industry-wide bottlenecks.

“There is no safety net for people like that,” confirmed Judd.

Todd Nienhouse, co-owner of Agevix, a Michigan healthcare company that provides therapy services to 40 people with catastrophic injuries from car accidents, said he expects to lose a third of those customers.

“We have adjusted our customer mix and are unlikely to take on new auto-related customers,” said Nienhouse, adding that the company will be forced to reduce customer home visits.

The rate cut is likely to result in some inpatients at facilities like the Traverse City Lighthouse being moved home or to adult care facilities where families and staff may not be trained to care for them said Judd.

Jessica Stark, a therapist at The Lighthouse, previously said that the care of 21 of the facility’s 23 inpatients was paid for through auto insurance claims.

State Long-Term Care Ombudsman Salli Pung previously said in a letter to Senate Majority Leader Mike Shirkey (R-Clarklake) that moving such patients to nursing homes was not a viable option.

“These specialized services are not available in nursing homes or other long-term care facilities, and the staff in these new facilities have not been trained to meet the special needs of these survivors,” Pung said.

A grassroots group, We Can’t Wait, made up of survivors, their family members, and caregivers, claims vendors won’t start getting cash out of the funds until 2022.

One member, Randy Bruce, owner of Aspire Rehabilitation Services, LLC, of ​​Troy, posted an obituary for his company on the group’s Facebook page.

“Aspire Rehabilitation Services, LLC, passed away peacefully with family and friends on June 30, 2021 after a long battle against corporate greed and violations of the law at the age of seven,” wrote Bruce. “Aspire leaves over 20 customers and 50 employees and was loved by everyone with whom they have had the privilege to work.”

Nienhouse and Ruckle-Mahon said they had their last hopes for a fair reimbursement of services on an ongoing insurance process.

A brain injury rehabilitation clinic and the guardians of two car accident victims filed lawsuits against Citizens Insurance and USAA Casualty Insurance, which were dismissed in November by Ingham County District Court Judge Wanda Stokes.

The case, now pending in the state appeals court, seeks clarity as to whether state no-fault insurance reforms can be applied retrospectively.